Samsung Group acquires mobile payments firm LoopPay

Samsung Group is in talks to acquire the US-based mobile payment firm LoopPay to counter the newly launched mobile payment system from its closest rival, Apple Inc. Samsung is expected to integrate the LoopPay services in its future devices, which will probably minimize the market of Apple Pay.

LoopPay was launched almost a year ago, and uses a different technique that allows nearly every PoS terminal to use it. Unlike, Apple Pay and Google Wallet, LoopPay does not use Near Field Communication chips to transmit the credit card information, but a unique magnetic wave spreading addon to process the payments at the terminals.

LoopPay puts a small add-on the device, which using the company’s Magnetic Secure Transmission (MST) creates magnetic fields that simulate those generated during the card swipe. It is applicable to almost every terminal, and none of them have to bring hardware changes to use it.

A report suggests that in US, use of NFC-enabled payment terminals is still minimum, however, the LoopPay’s technology can give Samsung an additional reach to the non-NFC payment terminals.

“NFC is currently only available in less than 10 percent of U.S. retailers despite NFC’s mobile launch almost a decade ago,” a Samsung spokeswoman said via email. “MST solves the merchant acceptance issue that has prevented other mobile wallet solutions from reaching mass adoption.”

In addition to it, JK Shin, head of Samsung’s mobile division said, “Our goal has always been to build the smartest, most secure, user-friendly mobile wallet experience, and we are delighted to welcome LoopPay to take us closer to this goal.”

Apparently, the acquisition will put the South Korean smartphone giant as a lead in the mobile payment system and will also have an effect on the company’s performance. Reports suggest that the Samsung Galaxy S5 didn’t perform well last year, and now the company is preparing the release of another.